Last month, Martin Wolf asked a “big question”: What is the role of the state? My characteristic response is to ask a very different question: What does the state do? Indeed, I tend to look at the way he answers his question as leading one to avoid asking (and answering) my question. His question is perfectly fitted for hortatory. Mine, for skepticism.

He does not linger on his question. He has a ready answer:

The core purpose of the state is protection. This view would be shared by everybody, except anarchists, who believe that the protective role of the state is unnecessary or, more precisely, that people can rely on purely voluntary arrangements. Most people accept that protection against predators, both external and internal, is a natural monopoly: the presence of more than one such organisation within a given territory is a recipe for unbridled lawlessness, civil war, or both.

He provides no evidence. He merely marshals everyday opinion on his side. Were he discussing life, he would no doubt crank out a Creator instead of “natural monopoly.”

I am not an anarchist. I have yet to be convinced of the position. But I’ll begin with a confession: If I have to read more prejudiced, lightly thought-out cases for state monopoly coercion, like Mr. Wolf’s, I’m about ready to concede, throw in my “agnarchist” badge and call myself a Molinari Man and be done with it. Mr. Wolf rests his case on natural monopoly on the idea that competing protectors would become predators and engage in internecine warfare. He presumably does this because he has lived under states, and states tend to do these things. If we had, in effect, more states, there would be more conflict.

But this supposition makes little sense. States engage in warfare for territory because they demand territory and subsist by taxation (regularized plunder). Citizens of a modern state are like subjects of the ancient states: They have little wriggle-room to get out from supporting the state in which they reside. Their fellow citizens will turn on them if they stop paying taxes, and the state can then go on and wrangle with them, secure in their territory. But competing protective services would subsist not by jurisdiction and taxation, but by contract. Though it is certainly conceivable that the clients of a protective service may authorize war, this would almost certainly be more rare under contract than under a system of generalized compulsion. Belligerent “voluntary states” misuse the funds and the trust of their clients by their very belligerence, so their clients would react by simply opting out. And, along with opting out, they would stop paying. There may be many reasons to reject Gustave de Molinari’s Dangerous Idea (competitive governments), but warfare and never-ending conflict is not one of them. Such are merely what people say who have not given the subject much thought.

But let’s get back to Wolf’s core contention: “The core purpose of the state is protection.” That word “purpose” is a little slippery. Organizations do not really have purposes. Individuals do. Organizations operate and demonstrate functions. And, operationally and functionally, is protection the core business of the state?

Looking back in history, and relating it to modern times, I wonder. Protecting whom?

It seems more likely that the core operation of the state is bullying and plunder. In force lies the origin of most states, and “telling people what to do” and “taking money from them against their individual wills” seems to be the signature activity of agents of the state. Further, defending a jurisdiction is pretty basic. This is drawn, universally, by “borders.” Territory.

Since individuals can, with something like ease, join up to become part of the functionary class of a modern state, and since modern states offer livings to people who are retired or ill-suited to work, and since modern states are representative democracies that allow one to campaign for votes and become part of the elite class in the state, a citizen of a modern state has many options for becoming a part of the state. Further, many citizens are more than willing to support the modern state and help in the general bullying and wealth extraction game. This muddies up any simple division between State and Society.

And it is this complexity of social structure and complicity of social agents that makes understanding the state so difficult. Wolf gets around the difficulty by using hortatory language through and through. His focusing on a “core purpose” amounts to an exhortation. “Protection” may be a traditional hortatory purpose of people who seek to use the state, ally themselves with the state, or gain supporters for the state, but it is not a very good descriptive term. Bullying and plunder, subjection and pillage are more accurate. We just don’t use them like that mainly because most of the time people talking about the state are defending the state. They theorize not to explain or understand, but to promote.

Nicely, Wolf does refer to ideas from a more skeptical mind than his own. After pushing the basic “protection” idea, he quotes Mancur Olson on the state as “stationary bandit,” an analysis similar to mine, above. And Wolf explains how we, in the West, guard against excesses of our stationary bandits:

exit, voice (on the first two of these, see this on Albert Hirschman) and restraint. By “exit”, I mean the possibility of escaping from the control of a given jurisdiction, by emigration, capital flight or some form of market exchange. By “voice”, I mean a degree of control over, the state, most obviously by voting. By “restraint,” I mean independent courts, division of powers, federalism and entrenched rights.

These three social forces, exit, voice, and restraint, are all that Wolf expects and demands of politics, and he hope that all three will to continue to play a role in modern society. Libertarian ideas, on the other hand, are suspect, since they

define the role of the state so narrowly and the rights of individuals so broadly that many political choices (the income tax or universal health care, for example) would be ruled out a priori. In other words, it seeks to abolish much of politics through constitutional restraints.

Two things are worth noting from the top. He sees libertarian ideas largely in terms of his third concept, restraint, which libertarians want to codify. But many libertarians place as much trust, or more, on exit rights, which now are almost negligible.

Let me explain by retreating close to home. My neighbor could escape Wahkiakum County by moving to neighboring Pacific County, but Pacific County (filled, as it is, with rich retirees from the big city) is far worse, with higher taxes and far more regulations. He could escape Washington State by moving to Oregon, say, or California — both far worse for him, in terms of personal freedoms (both would tax him worse). He could escape from the U.S., altogether, but the IRS would still hound him for taxes, and the government is cracking down on those who renounce citizenship. “Exit” doesn’t mean much when the states are all pretty bad, when each has agreed that about half of the wealth and lives and freedoms of any one person belong to the state and not to the individuals themselves. (I am, of course, in the same predicament as my neighbor; you are in a similar predicament, too, no matter where you live.)

Were the more radical libertarians to have their way, a right to exit would exist without moving. U-Haul or United Van Lines would be unnecessary tools to exit the embrace of one protective agency and into the arms of another; simply a notice of discontinuation might suffice.

And, under this regime, politics is not so much abolished as replaced with contract and negotiation. Actual, effective negotiations where the contract unites intent and payment, and feedback for bad performance can be rewarded instantly with lack of funding. Talk about a constraint against your “bandit”! Nothing like it exists in the modern state. That’s why the modern state is such a hypertrophied mess. Poor feedback. Half the people object to your policies? Tough toenails folks, we won the election, we’re getting our way.

Wolf doesn’t see much merit to libertarian ideas, though. He calls libertarianism “hopeless intellectually” because (and get this) “the values people hold are many and divergent and some of these values do not merely allow, but demand, government protection of weak, vulnerable or unfortunate people. Moreover, such values are not ‘wrong.’ The reality is that people hold many, often incompatible, core values.’”

This is not an objection to libertarianism. It is a problem that a political theory must resolve. People do have divergent values. Yes. On what criteria do we resolve different agendas driven by divergent values?

I value classical music and the most of my friends value popular music. What of it? The fact that a majority prefers popular music to classical music . . . does that make classical music worse? Does it mean we all should agree to support popular music in the schools, and not teach classical music? Does it mean that classical music should be prohibited? That popular music subsidized and classical music taxed? Or, by some great circuitous bend of logic, does it mean that popular music should be taxed, and classical music promoted at pop’s expense? (That’s almost what happens, today, in some cities, in some countries, and because of the distribution of divergent values.)

More core, though (especially if you look at our history from a broad, evolutionary perspective), is the desire to kill some people. A lot of people in America want to kill Muslims right now. I know. I’ve talked to them. Round up Muslims and shoot them. Or nuke Iran.Obliterate Mecca. Or something similar. They just hate Islam. And this, without ever reading The Koran!

So, this hatred for the other — that’s a very core and very human value, an all-too-human stance. And, because it is core, are the values behind the stance “not ‘wrong’”?

Similarly with expropriation. Lots of people want to live at the expense of others. And, more importantly, some people want to support some others at their expense as well as/and if only also at the expense of another group of people who would rather not support those others. Call the recipients of the aid “the weak” or “the poor” or “the unfortunately colored,” and you might indicate a value that can be whipped up into some semblance of civility. But it still amounts to promoting the values of some at the expense of others, favoring some over others and actually doing physical things in the real world, negatively to some and (allegedly) positive to others. It’s not just a matter of airily talking about ideals or hopes or dreams and such.

In a world of conflicting values, Wolf says, “Libertarians argue that the only relevant wrong is coercion by the state. Others disagree and are entitled to do so.”

Well, the question of entitlement is precisely the question, isn’t it? And libertarians, as I understand my colleagues’ thoughts, are not narrowly concerned with the state. This is an important misreading, a “creative misreading,” as Harold Bloom might say. Coercion by individuals is just as much suspect in libertarian quarters as is coercion by the state. Libertarians are against criminality. Indeed, they have a theory of criminality that depends upon the basic categories of human interaction — not how we value those interactions, as such, but the categories themselves — and extends that theory to the state itself.

Libertarians are basically alone in their approach to politics. They have a theory of criminality that is truly general and universal, and it applies to groups of people as well as individuals, and makes no excuses for groups that would not pertain to individuals, if the right circumstance and actions were involved. That is, no action approved as legitimate by the state can be prohibited to the individual, and no action prohibited to the individual can be legitimately approved when performed by the state.

But, ancient state and modern state both work on vastly different principles from the libertarian view. These widely accepted principles are “political” principles, in that they jiggle the boundaries of criminality in peculiar, gerrymandered ways, as a result of political negotiation and struggle. These twisted boundaries are accepted for a number of reasons, in part because they do provide “an order,” and in part because, no matter how unjust any particular rule set may seem to a party at a particular time, hope is given to the aggrieved party to someday “right” that value-laden, legally established preference — but only if the aggrieved continues to participate in the political process.

Thus “voice,” in classic democratic and republican theory, substitutes for “exit.” There is no exit. Not really. Only slight, marginal gains by moving from one place to another, which hardly effects policy at all.

But most places in this Age of Democracy do give you a venue to express your “voice.” Of course (and interestingly, Wolf makes no mention of this), politicians in our current United States, as in many states around the world, have worked mightily to limit “our voice.” Ballot access laws are often draconian, and usually solidify the two-party system. First-past-the-post vote-counting further enhances the two-party hegemony. Resistance to innovative uses of the ballot, such as proportional representation, Instant-Runoff and Condorcet Voting, are the norm in the political elites. Opposition to term limits by that same political elite ensures that incumbents always maintain an advantage, while insider support of “campaign finance regulation” ensures that only a limited number of voices get heard at election time, further solidifying incumbency and a few established channels of influence (lobbying at the expense of public suasion).

Indeed, considering the trap that we are placed in, with representative democracy, the most likely way out may be to increase the power of “voice” — though in America the restraint of the court system (and the limits of a few remaining, and few gaining, portions of the old Constitution) keeps us freer than we would otherwise be.

Exit, I repeat, means little to America’s rule-makers, especially since more people want to enter than exit, and those who do exit are hounded if they continue to gain wealth within America’s territorial boundaries.

Wolf savvily understands that “once one has accepted the legitimacy of using coercion (taxation) to provide the goods listed above, there is no reason in principle why one should not accept it for the provision of other goods that cannot be provided as well, or at all, by non-political means.” He is not nearly so savvy, however, in not recognizing that not one of the “goods” he has mentioned is univocally a “good.” Even something as near-universally approved (in America) as the Interstate Highway system is largely responsible for much of the degradation of wildlands between city regions. One could easily argue that the establishment of state-run roads has led to a devastating ecological hardship that would not have occurred under so-called “unrestrained” laissez-faire. It is subsidized interstate roadways that have done the most damage to the decentralized economy and culture of America, as well as expanding civilization into hinterlands that would have otherwise remained only lightly touched by man.

Other programs that seem so good to us, such as Social Security, have exacted high social costs that proponents refuse to recognize as problems caused by their beloved system of extraction and distribution. One of them is family and clan solidarity. Another is tolerance for inflation. And yet another is the intergenerational swindle that has proven to be so amazingly large in every instance of government-provided universal pension programs. The first participants got huge returns, making the program “untouchable” in politics, while later generations find themselves trapped with paying ever-increasing portions of their paychecks to a system that makes it harder for them to save outside of it. That is, the longer a social pension system like Social Security/FICA goes on, its increasing burden precludes whole classes of people from treating it as it was ostensibly aimed for: As a “safety net” pension to be “added on” to one’s main, private savings for retirement.

But of course the original “purpose” for such a program is usually a lie. That’s how politics works. You have to look at how a system works, not how it is publicly ballyhooed. Only fools accept government at its word, politicians at their words. And here is where Wolf goes completely off the beam:

In the 1970s, the view that democracy would collapse under the weight of its excessive promises seemed to me disturbingly true. I am no longer convinced of this: as Adam Smith said, “There is a great deal of ruin in a nation”. Moreover, the capacity for learning by democracies is greater than I had realised. The conservative movements of the 1980s were part of that learning. But they went too far in their confidence in market arrangements and their indifference to the social and political consequences of inequality. I would support state pensions, state-funded health insurance and state regulation of environmental and other externalities. I am happy to debate details.

Wolf has proclaimed his unhappiness to debate principles. But details? Well, here’s a detail that has begun to loom large: Across the Western world, accumulations of “ruination” are now beginning to dissolve the great “welfare” programs. Excessive promises are putting state after state teetering towards insolvency. The functionary class — the public employee unions — have supported politicians (especially Democratic Party politicians, in America) in order to finagle (over and over, in jurisdiction after jurisdiction) amazing pension programs that amount to little more than unpayable promises. The PIGIS (Portugal, Italy, Greece, Ireland, and Spain) countries have proven themselves the true piggies, and are showing how dangerous standard-brand social democratic policies have been.

And yet Wolf has more hope now than he had in the ’70s.

In the ’70s the social pension system was still relatively immature, the demographics still supported another generational swindle, and the chief problems of the macroeconomy could still be bled out by holding back the pump-priming of the central banks. I, on the other hand, had hope in the late ’70s because I retained some confidence in those who ruled us (I was pretty sure they didn’t want to go under, and would discover the means to avoid such a calamity). I’m now far more skeptical that they will be able to find politically acceptable ways to maintain their hegemony without a return to tyranny as a way of life.

We will see if Wolf proves the better prophet. He does recognize that these are important issues. Talking about the objections to actions he thinks completely legitimate (such as massive redistribution, regulation, etc.), he writes that the programs might offend by being “ineffective,” “unaffordable and might lead to state bankruptcy,” might “encourage bad behavior,” and, well, might just prove too nasty a restriction on individual liberty.

Well, libertarians are usually willing to argue all or most of these, depending on the subject. For my part, I regard a rule of liberty instead of a rule of mere legislated rules a grand shortcut that saves us all a world of hurt, a world of corruption, a world of grinding coercion. But it’s important to note that it is a “short cut” only in the context of politics. In the context of principles, it is just general good sense. It is based on a jaded view of human nature, recognizing its dark side in violence and exploitation and recognizing its bright side in free co-operation.

It’s interesting that such a short cut was once considered absolutely necessary for the moral progress as well as the progress of the wealth of humankind. Nowadays, such a short cut seems to too many people a terrible limitation on the clash of group effort.

And here we get to the nub of it. It really is the sanctity of groups that the modern democratic state continually devolves down to. It is group interests that get heard louder and clearer than individual interests. It is group membership that becomes vitally important for power. Further, it is no accident of ideology that we now regularly talk of “group rights.” A hyphenated American is far more important, in America, today, than a mere American. And membership in a union or a designated victim group carries more weight in political discourse than does membership in any given jurisdiction.

Which is why, to growing numbers of Americans, the very texture and taste and feel of politics now is corrupt and putrid in and of itself. Both major parties, increasingly, receive cold shoulders and dismissive sniffs and shrugs.

Corruption from honest principles is inevitable as long as people demand that some live off others. Dishonesty must be a way of life, in such a polity. Sectarian nastiness, greed, and envy become, then, embedded in the culture.

Only by shifting the perspective away from values as “what we want” to practical principles relating to the means we choose, only when we value liberty and responsibility over some hoped-for advantage trumping a neighbor’s interest, only then will American political culture regain a sense of dignity and honor.

Democracy, Wolf says, “necessitates debate among widely divergent opinions.” But, as everyday rhetoric rightly has it, we each get to have his or her own opinions, but facts? No. They are not “divergent” and “subjective” and up for bargain.

The most basic fact of social life is that coerced co-operation is of a radically different character than voluntary co-operation. It is also worth noting that voluntary co-operation is not just the market and its familiar institutions, ever evolving; it is also in the community and the home and lodge and the church and mosque and the local Boy Scouts. But the amazing mutual gains that these co-operative endeavors can provide depend, in large part, on their actual voluntariness: On participants being able to exit as well as have a voice, and on the restraint provided by the constraint of retaliatory (not micromanaging) law.

We may find that many of the current social functions now performed by the state will flourish under these exact same constraints — though undoubtedly the institutional arrangements will vary widely in “touch” and “feel,” coercion being replaced by contract. The rule of law would be inverted to apply, just as equally, to the institutions that directly uphold it.

This form of civilization is, as Wolf says, politically unlikely, “hopeless,” at present. That is because, at present, we are, nearly all of us (except libertarians) caught up in the mania of hope for outrageous advantage.

When this hope gets laid to rest, then we can continue to develop more humane relations.

And there is some hope. Individually, gamblers do quit their outrageous mania for raking risks to achieve “the big score.” Individually, thieves do reform, and resort to “mere” trade. And individually, most bullies do grow up, and learn to stop pushing people around.

Citizens and politicians, both, must grow up from their addiction to the game, their habit of crime, and their love of nasty intimidation.

That is really all that libertarians demand. Maturity. What we demand of children, growing up, we demand of adults, in their relation to “governance.”

Unlikely, but not exactly without precedent.

A first step, I hazard, would be to cease relying on the pious pronouncement, such as loose, unrealistic talk about “core principles” of existing states. We must focus on what actually goes on, and the full reality of the fantasies that rule us. Fantasies of the big score nudge us to try (just try, mind you) to live at the expense of everyone else, and then accept the consequences of our failures to do so as “imperfections of the market” or the result of “too much freedom.”

No Exit

Thursday, September 9, 2010

Martin Wolf

is a well-thought-of writer who obviously intends to strike a pose, that of a reasonable adult. Fortunately for him, standards for that are really low. Especially when it comes to writing about politics.